The `NORMSDIST` function in Excel is used to calculate the standard normal cumulative distribution function, which is the probability that a standard normal random variable (Z) is less than or equal to a given value. The standard normal distribution has a mean of 0 and a standard deviation of 1.
Here’s how you can use the `NORMSDIST` function:
Syntax
=NORMSDIST(z)
- z: The value for which you want to calculate the probability.
Instructions
- Open Excel: Start Microsoft Excel.
- Click on a Cell: Select the cell where you want the result to appear.
- Enter the Function:
- Type `=NORMSDIST(` in the selected cell.
- Enter the value of `z` that you are interested in.
- Close the parenthesis `)`.
For example, to find the cumulative probability for `z = 1.5`, you would enter:
=NORMSDIST(1.5)
- Press Enter: After typing the function, press Enter to calculate the result. Excel will display the probability that a standard normal variable is less than 1.5.
Example
If you want to find the probability that a standard normal random variable is less than `z = 1.96`:
- Type in a cell: `=NORMSDIST(1.96)`
- Press Enter, and Excel will return approximately `0.975` which is the cumulative probability.
Note
- `NORMSDIST` has been replaced by the more robust `NORM.S.DIST` function in recent versions of Excel. You can use `NORM.S.DIST(z, TRUE)` to perform the same calculation, where the `TRUE` argument specifies that you want the cumulative distribution function.
- The `NORM.S.DIST` function is recommended for newer Excel versions because it offers more consistency and better precision.
Using the `NORMSDIST` function is simple and effective for statistical analysis where the standard normal distribution is applicable.
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